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When Telecom Mergers Hit Home

netbuzz writes "A telecom manager submitted an essay to Network World that paints a sadly humorous picture of what the mega-telecom mergers really mean on the ground." From the article: "Well, when I heard that these companies were about to combine forces, it made my blood run cold. How would they be able to take, in each case, two companies with already broken processes and mediocre customer support and successfully merge them? How could they continue to provide me with the support I need to keep my company's networks functioning as they need to in this age of the bandwidth junkie? The answer ... at this moment, is they can't!"

14 of 131 comments (clear)

  1. Welcome to the world of tomorrow by dgatwood · · Score: 2, Insightful
    Just a few more decades until the telecoms morph into Mom's giant robot company....

    But seriously, did anyone really expect that consumers wouldn't be harmed by all the telecom mergers? Monopolies are always bad for consumers, which is why they are so heavily regulated. Since there can be no practical competition to a land line phone provider, the only choices that aren't inherently harmful to consumers are A. highly regulated monopoly, B. government-run monopoly, C. a non-profit cooperative.

    Stop with this foolish deregulation before it's too late....

    --

    Check out my sci-fi/humor trilogy at PatriotsBooks.

    1. Re:Welcome to the world of tomorrow by cyngus · · Score: 4, Insightful

      The telecom's are far from a monopoly and I'll tell you why they are merging, survival. What is a telecom has expanded, the Internet broadened the term. A telecom is just someone with a pipe capable of delivering data. You can deliver almost any service over IP, so anyone who can carry IP traffic is a telecom. Suddenly Comcast and TimeWarner are as much a telecom as AT&T, SBC, or Verizon. Now the prize is also much bigger, its not just voice traffic, its voice, internet, and media (TV, radio, and movies). Bigger prize makes bigger companies because they need more resource to try to win. And more competition is, guess what, great for consumers! This is why we get IP phones for next to nothing, cellular with free long distance. If it were 20 years ago, I'd pay thousands of dollars a month talking to friends around the country, but not with my trusty cell phone. Also, you're wrong that monopolies are always bad for consumers. A monopoly in an industry with low barriers to entry is great for consumers, because the monopolist has to try really hard to keep it, and they have the resources to continously improve the product. Monopolies in industries with high barriers to entry usually are harmful.

    2. Re:Welcome to the world of tomorrow by nyet · · Score: 4, Insightful

      t is regulation that creates monopolies, not deregulation.

      Ludicrous. Reminder, this is the telecom provider market. That means there will ALWAYS be monopolies - its the nature of the beast, like road, sewer, water, and energy providers. Regulation of those natural monopolies creates regulated monopolies. De-regulation of those natural monopolies creates unregulated monopolies.

      Pick your posion, but don't pretend that deregulation will magically prevent monopolies from forming in a market where natural monopolies are unavoidable.

    3. Re:Welcome to the world of tomorrow by vertinox · · Score: 2, Insightful

      Also, you're wrong that monopolies are always bad for consumers. A monopoly in an industry with low barriers to entry is great for consumers, because the monopolist has to try really hard to keep it, and they have the resources to continously improve the product. Monopolies in industries with high barriers to entry usually are harmful.

      Hrm... I'm pretty sure the grand parent just said that. He said the monopolies that aren't bad for consumers are the ones that are heavily regulated.

      And in your statement, the following is also true about harmful monopolies... The telcoms have in place extremley high barriers to competition. Not only is this the nature of the industry (no one is going to spend millions to make their own network any time soon), but they also are using government to keep this in place such as the banning of municipal wifi networks around the nation.

      --
      "I am the king of the Romans, and am superior to rules of grammar!"
      -Sigismund, Holy Roman Emperor (1368-1437)
    4. Re:Welcome to the world of tomorrow by dada21 · · Score: 2, Insightful

      There is a ton of proof that de-regulating monopolies creates better products, including the municipal arena.

      Stossel did a 1 hour episode on ABC that showed the various municipalities that de-regulated the water source, and water became cheaper and safer. Many cities are partially deregulating their bus services (buying the busses and then leasing them to competitive businesses for operation) and the costs are dropping 50% while service quotas are kept and beat. California allowed a private tollway to be built which was a huge success before California grabbed it back and screwed it up again.

      The proof of privatization comes from other areas. After the airlines were deregulated, the costs fell. Look at subsidies: Airlines now get about $6 per 10,000 miles flown. Greyhound gets about $4 per 10,000 miles driven. Amtrack gets $200 for the same 10,000 miles, and Amtrak is 100% regulated. When Amtrak was created in 1971, the train industry was hurting because of cars and busses and airplanes, but it was still viable. Amtrak destroyed the competitive market and is now completely run by unionized management who asks for more and more money. The last year of Amtrak that was audited had fewer riders than their first year.

      Even beyond that look at what privatization has done. When the TV cartel was opened to competition, cable TV came in and slaughtered the old system, replacing 5-10 channels with hundreds. Cable then became a regulated media and the growth slacked until recently as cable companies started to find competitive ways to sell their regulated product. If the regulations were dropped, I bet we'd see many new and competitive features introduced.

      The PC market is a mostly unregulated market. The areas that are most regulated tend to have the highest cost products with the least amount of choice. The cost of a PC has dropped enormously.

    5. Re:Welcome to the world of tomorrow by CallFinalClass · · Score: 2, Insightful

      Well, the MAJORITY of backhaul from cell sites goes through telco-owned T1s/T3s but don't forget microwave backhaul. Also, one cell provider in the states had foresight and wired each site with their own fiber-optic connection.

  2. There's an old saying... by Churla · · Score: 2, Insightful

    About the cognitive awareness which exists between the leftmost and rightmost appendage of an organism and the unique level to which it doesn't always exist.

    This merger frenzy is now creating corporate organisms with an exponentially larger number of hands.

    What do we expect?

    Maybe Fox can do a special about it and call it "when corporate bureaucracies attack!"

    --
    I'm a fiscal conservative, it's a pity we don't have a political party anymore
  3. This is great by cyngus · · Score: 4, Insightful

    The great thing about merging two incompetent companies is they usually collapse faster and make room for someone who can do what the customer wants.

  4. Mergers by Renraku · · Score: 3, Insightful

    Mergers usually happen before everyone knows all the facts. Rather than being good for the customers and saying, "Do stuff as usual until we come up with new rules.." its "Don't do anything until we come up with new rules.."

    This is obviously retarded. They end up losing a lot of money during the merger because of this. Another problem is that a lot of companies will say something like, "Ok. Now that you're a part of us, go make us some money. Bitch." Never mind that they pretty much just cut the throat of the company, leaving it with very little ability (or authority!) to do anything.

    --
    Job? I don't have time to get a job! Who will sit around and bitch about being broke and unemployed then?
  5. Re:Come On... by 99BottlesOfBeerInMyF · · Score: 2, Insightful

    Telecomm customer service and response has NEVER been good, so why call it into question in light of recent mergers?

    Both of the issues exemplified in the article were new issues arising from the fact that because of the merger the new company could no longer provide services they once did. Since there is no competition due to the merger, I'd say it is reasonable to call into question how much the merger has crippled the ability of businesses to acquire and use these services. This is concrete harm to the consumer and the economy. It is always worthwhile to question the decisions made by the government to see if they are doing their job. It seems in this case they are not.

  6. Re:give them what they want by k12linux · · Score: 2, Insightful

    They claim competition on one end and then degrade VoIP traffic intionally on the other.

  7. Re:give them what they want by IANAAC · · Score: 4, Insightful
    They claim competition on one end and then degrade VoIP traffic intionally on the other.

    The parent post really does give good advice. My provider (Speakeasy), for instance, uses its private network for all its VoIP and has decent QoS. So no, SBC can't degrade my VoIP traffic. Are they as cheap as SBC or Verizon? No, they're actually a fair bit more expensive. But that is how I choose to vote with my dollar. And when I left SBC I let them know exactly why I was leaving. Poor customer service, one arm of the company not knowing what the other arm was doing, etc. I've never, ever had any customer service issues with my current provider. It's definitely possible to find a provider that doesn't rely on SBC or Verizon, povided you live in a fairly major urban area.

  8. Competition by Beryllium+Sphere(tm) · · Score: 2, Insightful

    The article makes it clear that the telcos are refusing to take orders from paying customers.

    If Janet Ley had a real alternative to Verizon and ATT, don't you think she'd be taking it?

    If a company has real competition, what happens when it blows off its customers? It goes out of business. Are the incumbent telephone companies out of business?

  9. Re:Why all the fuss... by 99BottlesOfBeerInMyF · · Score: 3, Insightful

    Why all the fuss about the telecom mergers/aqusitions? It is the nature of a free market that some companies will win and others lose.

    What exactly do you think the merger of two government enforced monopolies into a larger government enforced monopoly has to do with a "free market?" The free market is not operating on phone companies. AT&T was not taken down by the free market, they were split up by the government for breaking the law and because the situation was so bad everyone had to rent their telephone as well as pay high rates for crappy service.